Easyjet confirms securing £600 million government loan

Thursday, April 9, 2020

Easyjet secured a £600 million loan from the Covid Corporate Financing Facility (CCFC) which was issued by the HM Treasury and Bank of England.

The cash reserve is raised to around £2.3 billion as additionally the carrier has drawn down $500 million from its Revolving Credit Facility.

Earlier Easyjet’s founder and largest shareholder Stelios Haji-Ioannou cancelled the carrier’s £4.5 billion contract  with Airbus to be cancelled. It warned that failure in doing so may see the airline running out of money.

At the end of March the entire fleet of Easyjet was grounded and at this stage there was no certainty of the date for restarting commercial flights.

Johan Lundgren, the CEO of Easyjet said that  remain absolutely focused on ensuring the long-term future of the airline, reducing their costs and preserving jobs, to make sure Easyjet is in the best position to resume flying once the pandemic is over.

They were pleased that they have now reached agreement with both Unite and BALPA regarding furlough arrangements for UK-based EasyJet pilots and crew.

Currently they want to safeguard short term liquidity, so they borrowed from the CCFF and drawn down on their Revolving Credit Facility in order to increase liquidity in the event of a prolonged grounding of the fleet.

CCFF provides businesses with access to funds at the commercial rates which were available before the coronavirus crisis and any UK company that had an investment grade rating before the crisis can apply for this funding

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